The bill H. 4216 proposes significant changes to South Carolina's income tax structure by amending several sections of the South Carolina Code of Laws. It establishes a flat income tax rate of 3.99% for individuals, estates, and trusts starting from taxable years after 2025, while also setting standards for potential future reductions based on revenue growth. The bill includes provisions for a phased reduction of the top marginal tax rate, which will decrease from 6.5% in Tax Year 2022 to 6% in subsequent years, contingent upon a projected increase in general fund revenues. Additionally, it introduces a South Carolina Income Adjusted Deduction (SCIAD) with varying amounts based on filing status, and it specifies that the federal standard deduction and itemized deductions will not be adopted by the state.

Furthermore, the bill makes conforming changes to various sections, including the requirements for filing tax returns and adjustments for nonresident individuals. It also mandates the Department of Revenue to adjust withholding tables to align with the new tax structure. The act is set to take effect upon the Governor's approval and will first apply to tax years beginning after 2025.

Statutes affected:
03/25/2025: 12-6-510, 12-6-50, 12-6-1140, 12-6-4910, 12-6-1720
03/27/2025: 12-6-510, 12-6-50, 12-6-1140, 12-6-4910, 12-6-1720
04/02/2025: 12-6-510, 12-6-50, 12-6-1140, 12-6-4910, 12-6-1720
04/30/2025: 12-6-510, 12-6-50, 12-6-1140, 12-6-4910, 12-6-1720
05/06/2025: 12-6-510, 12-6-50, 12-6-1140, 12-6-4910, 12-6-1720
05/07/2025: 12-6-510, 12-6-50, 12-6-1140, 12-6-4910, 12-6-1720
05/07/2025-A: 12-6-510, 12-6-50, 12-6-1140, 12-6-4910, 12-6-1720
Latest Version: 12-6-510, 12-6-50, 12-6-1140, 12-6-4910, 12-6-1720